Parliament approves GH¢1 fuel levy per litre amid energy sector woes

Parliament has approved the Energy Sector Levies (Amendment) Bill, 2025, paving the way for an additional GH¢1 charge per litre of fuel at the pump.

The bill, introduced by Finance Minister Dr. Cassiel Ato Forson on Tuesday, June 3, was presented under a certificate of urgency and passed on the same day.

The new levy, which increases the Energy Sector Shortfall and Debt Repayment component, aims to raise revenue to tackle mounting challenges in the energy sector. Dr. Forson explained that the funds will be used to clear arrears, reduce legacy debts, and maintain a stable electricity supply nationwide.

“The energy sector currently poses the greatest economic and fiscal threat to the country,” Dr. Forson told Parliament, warning that failure to address the situation could lead to a full-blown national crisis.

According to the Finance Ministry, the levy is expected to generate an estimated GH¢5.7 billion annually. As of March 2025, the energy sector’s total indebtedness stood at US$3.1 billion. The government estimates that US$3.7 billion is needed to clear the debt, along with an additional US$1.2 billion to purchase fuel for thermal power generation through the rest of the year.

Despite concerns about the impact on fuel prices, the Finance Minister assured legislators that the levy’s effect would be cushioned by the Ghana Cedi’s recent strong performance. As a result, consumers are not expected to experience an immediate hike in ex-pump prices.

The bill was not without controversy. The Minority in Parliament strongly opposed the measure, arguing that it imposes an unnecessary financial burden on Ghanaians. In protest, they staged a walkout during the approval process to register their disapproval.

The bill was initially read and referred to the Finance Committee for immediate review before being approved later that same day.